sports, cabella's, hunting gear and equipment retailer. >> yeah, right. of lots of good stuff happening, so don't go away because "the call" is next and trish is ready. >> i sure am. good morning, everyone, welcome to "the call," 90 minutes into trading, the summer rally is back here, up 172 points on the dow. but will it last? that's the big question. and we're going to tackle it. morning, larry. >> good morning, trish. i'm larry kudlow, a very big day for earnings, we're monitoring the exxonmobil conference call. we have two more call sclufs when we talk live with the ceos of kdw on just released earnings. >> and when you lose weight, it's a growing trend in companies. we'll talk live with the president of the leading provider of employee health programs. this is "the call" on cnbc.
summer rally on wall street is in full swing, up corporate earnings and a benign weekly jobless report putting investors in a buying move. the nasdaq going above the 2000 level since october. the dow up 171 points. rally mode. almost 2% on the day. 9242. the s&p, the last time it was above 1000 was november 5, and right now is sitting at 99 6, up more than 2% on the day. take a look at the nasdaq, as well, it is charging higher, up 2% on the day, as well, almost 40 points above 2000. like we said, wow, trish. i think it's the bright colors you're wearing. >> thank you, melissa. i hope that's lending itself. unfortunately, i think my shoe just got caught in my microphone cord for a moment. all right, back on the ground. two feet on the ground. excitement today, 173-point gain. there is a feeling of optimism, a sense that maybe -- in fact, this economy is going to be turning the corner very soon. we're in that recovery stage, and you're seeing that reflected in the optimism in the market.
want to bring in bob pisani, who is watching all of the internals here. >> i'm watching you almost fall over there. i'm bringing in a hula hoop next. that would impress me. >> wow, a summer rally here today, is it going to last, i guess that's the big question. >> well, some things have turned around. remember what's been bothering the market in the last few days. the dollar rallying. china got hit badly, as commodities moved down. today, china is doing a heck of a lot better. and have you noticed, folks, this is the dow yesterday. have you noticed from the last five days the middle of the day they try to push the market down, and then suddenly the market rallies in the last hour. yesterday the dow rallied 51 points in the last hour. and here's an interesting question. why has this been happening? you just won the hula hoop. here's what -- one thing that's going on. there are a lot of people who think the market is overbought. and a lot of the day traders, people coming in the market every day, have been trying to press the market down because they think it's overbought.
but at the end of the day, a lot of people have to cover. if the market doesn't drop much and they have to cover, there is a natural upward bias to the market here. and a lot of people are getting caught here at this point, because the market is not dropping as much as they thought. this is this resiliency theme i keep pounding away at. so a lot of people are getting hurt here, and natural buyers today are really coming in had. the volume is a little stronger than normal. let's talk a little little bit -- >> what is this news, you're the average investor at home, maybe you should think about doing that later in the session. >> it is not -- it's not making the concerns about a dip in september and october go away, because the bears are convinced that once you realize there's not going to be big top line probe, the market will dip down again in september and october. but for the moment now, china, for example, coming out and saying, we're going to keep a relatively loose monetary policy, assuring everybody. we're not going to try to mess with the stock market. that was the big thing. right. one day. day-and-a-half, basically. >> and quite a recovery. >> what it does to commodity
stocks. >> oil. >> we had the strong dollar, the china issues, all hurting big commodity stocks and basic materials. those stocks are all back again. >> do we have any of those charts we can show? because oil is a big one. >> big names moving around here. the situation with energy is a little bit different. a little more complicated. there is the big moves up here. exxon was very disappointing. royal dutch basically came out and said we're not expecting huge recovers at all for a long time here. and they're cutting their capital expenditures at this point. but still, they're still playing the recovery that's going to happen in the first half of 2010. >> anyway, it's nice to see kind of a change in that, a change in mood down here, and the question, of course is going to be is it going to last. >> remember, the market never dropped, it only moved sideways under a little pressure. we have not seen any successful attempt to sell the market off in weeks now. and the s&p, folks, may close over 1000 for the first time since november. knocking right at the door here at the s&p. >> bob pisani, thank you very
much. larry, take it away. >> thanks, kid. more on this terrific summer rally that won't let go, went go down, we should stop nit-picking and rock and roll. let's bring in peter sar enteen owe, and chief economist, diane swank. let's put the unemployment numbers on the screen. i feel like warner wolf or something. the four-week average continues to decline, a terrific signal that is one of the most important leading indicators. isn't as clear-cut as i would like it to be because of gm layoff timings, but nonetheless, the pattern is clear. diane swank, i like this story, and i think with profits improving, people missed the stock rally because it's too darn pessimistic about the american recovery. >> well, they're certainly pessimist pessimistic. you and i have been talking about a positive second half for a long time. the question is, how positive will it be, and how self-feeding will it be and i think markets are up a little now, but as i
said a couple days, larry, i'm a long-term investor and a year from now, i don't know whether we'll be crossing 10,000 a little too soon, but a year from now well above the 10,000 mark. so i'm optimistic over the next 12 months, but i think there will ab i of volumety. >> they're talking about a v-shaped recovery. it seems like a threat is out there that this is going to accelerate faster than the petitions mists have thought. and that's what the market is reacting to right now. why that change and sentiment, and do you think it's for real? >> well, we went from a psychology where people were more concerned about return of their money rather than on their money. so that psychological change, you know, where now people are concerned about return, that's had a lot to do with it. i think some of those forecasts about a v-shaped recovery, you know, they're looking at the enormous amounts of stimulus that are being poured on, the monetary authorities keeping a relatively tox lax tone and
thinking this is throwing gasoline on a fire. that's not going to happen. we're going through some structural changes. but that said, the market was riddously valued. we just finished three pricing rally. where to from here? >> allen valdez. allen, i think it's a bad earnings, i think the earnings surprise took everybody by surprise. i think the bears had to cover their shorts, all of the smart hedge fund money had to cover its shorts, and allen, why is it so important, the shape of the recovery? look, two or three percent growth ain't chopped liver. if it's 5 or 6%, that's more normal. but isn't it the point that it's going from down to up and isn't that what everybody is missing? >> that's 100% right, larry. 100% right. and yesterday you saw the ici numbers from the mutual funds, they're starting to get involved also. so you see that flow come in. but you're right, we're stabilizing, even jobs. i'm not making light of 584,000
job losses, but still, 0% of country is working -- 90% is working. you're seeing it reflected in the stock market. it's a good barometer for that. you are seeing the market go up. whether you believe the earnings or not, the market is going up, and we like what we see down here. for traders, we love what we see here now. >> diane, two very important data points coming up that the market is no doubt going to be glued to. the gdp number tomorrow, which of course everyone says is backward-looking, nonetheless, could cause the market to falter or go higher and the monthly jobless number coming up next week. what do you think of those? >> i think we're going to see the gdp number down 3/4 of a percent, 6/10 of a percent range. that's better than people expected. mostly because trade is going to be moving in the other direction. government spernlding will be positive. the consumer, though, will still be negative in that number of after a positive first quarter. so it's going to be a mixed bag, but i think this is afternoon an
inflexion point and we're moving toward recovery. >> diane, one important number is going to be inventories. i maintain this is going to be surprisingly a business-led recovery. that's what the earnings are showing. and it's businesses that create jobs for consumers. it may be slow, but i think that's where the income -- now, have businesses finished cutting inventory, diane? that's for q3. >> exactly, a very important issue. and we know production in the vehicle sector, autos and housing, the biggest negatives in the u.s. economy have moved in the positive. that's good news. the other issue, even if we see things abate, we're into the move where we're not building inventories yet, but some firms have started to begin the process and that's good. the one other point that is really important to make here is not only are earnings surprising up sides, but there is guidance. there was no guidance in the first half of the year. and the fact that some people see a horizon out there i think is a big difference. >> this ability has really improved a lot.
that's a great point. >> peter, given everything we have said so far, how do you make money in this environment? >> i think you look at where the economy is progressing, and you look at the progress on the trade defycy. if you look at what's growing in the way of exports, trace that back. where is demand right now, where are we seeing sales go out the door? that's where you want to focus. that's why the nasdaq has had a better first half than we have seen in a long, long time. >> and allen, is this a recovery trade? to some extent, i just want to say buy the the broad indexes. they're all going up. >> they are, larry. if it you look at where we were last year as opposed to this year, this market, 100% better. we are really on the rise here. and i think people forget that. last year, near a depression, things were out of control. this year, we're stabilizing. >> did you see that story in the "journal" this morning, real quick? the libor rate has come back all the way down and the spread against the fed funds rate has come all the way down, the crisis is over. that is so key. >> we've got to go, guys. thanks so much for joining us. we appreciate it.
trish. >> okay, coming up next, kbw earnings, they beat the street. so what's ahead for the largest boutique investment bank? we're going to ask the kbw ceo in a call, an exclusive interview, melissa. >> and looking for an extra push to hit the gym more often? maybe your company has just the right incentive. details on the new trend spreading across corporate america. that's coming up only right here on "the call." we'll be right back. i know.
we have to show you big board here, because why not? we are up 150 points right now on the dow. big question is whether or not this summer rally is going to last. but we do have stocks touching 2009 highs. so some optimism down here for sure. meantime, kdw retaining up better than 2.68% there, a gain of 77 ke79s, 29.50 a share. take a look at three months, up almost 22%. in another call exclusive, kdw, ceo and chairman john duffy joins us from new york. good morning, john. >> good morning, trish. >> does this mean the financial companies are essentially out of the woods? >> well, certainly the tone is dramatically better in the last three months. the capital markets window is open for the banking industry. our equity capital markets business is very strong in the second quarter. obviously, that's got positive signs, i think, for the economy.
we need a healthy banking industry. if we're going to have a healthy economy or strong economy. >> okay. so john, the capital markets are open for the financial institutions. at what point is that really going to translate into individuals being able to access liquidity? individuals being able to really access financing, whether they want a car, whether they want a home, whether they want a new credit card. >> well, credit is obviously still tight. but i think it's the the banking industry, it's healthier. those credit lines will open up, but i don't think we're going to return to the excesses that we had in 2006 and 2007. there will be new standards, so credit will be tougher, but i think generally over the ensuing quarters, we expect some credit relaxation on the part of the banks as they get healthy. >> john, as you know, i count this all of the time. find the bank you hate and buy it. because i think with a zero short rate and a steep curve, bankers can make money, and earn their way out of the toxic
assets. what's your take? you're in the trenches on this. what's your take on that? >> yeah, we definitely feel we're in a period here where we are going to have a positive slope to the yield curve for quite some time. short rates will stay low. you know, while we're seeing some green chutes, you know, we don't expect a dramatic rebound in the economy. >> isn't that the ideal situation for a bank? i mean, it doesn't get any better than that, does it? >> that's right. and the positive inflows have been quite strong the last two quarters. fdic bumped up limits. consumers who weren't going to buy stocks are putting their money back in banks. and that's good. they need the core funding. >> you mentioned before, john, we're not going to get back to the hey days of 2007 where credit was flowing and i think everyone agrees that's probably a good thing. at what point do we get back or ever get back to a situation where the financials really become the leaders of this market, really become sort of the drivers of this market?
for a while there, it was like financials were the new sort of -- you know, the industrials of a previous year. do you think we go back to those times? >> well, we've still got some ground to make up. our bkx index for the year is still down 10% from the year-end 2008 close while the s&p 500 is up about 10%, if you factor in today's gains. so, you know, the banks have still got a way to go. we think certain ones are cheap. we've got to be careful. credit is the issue. earnings in the second quarter for the banking industry, 60% of the 145 banks that have reported so far, missed their estimates. so credit is still the overriding issue. so i think we've got to get -- we've got to get a little bit further along in the cycle. people are comfortable about asset valuations, and the banking industry has more of these credit write-downs behind them. >> john, one quickie. i'm very concerned that the in other words and the egg heads at
thasby are about to strike again. they loosen the mark to market with cash flow ideas last april. that helped the rally. now there's been stories circulating that they're about to tighten the mark to market screws again. are you following that? should investors be worried about the nerds from thasby with the power to destroy the rally? >> it's always something to be concerned about. >> what are you hearing, john? this is a key issue, valuation of these assets. >> i think the market to some degree will look through whatever the accountants decide or don't decide. as we get more transparency in terms of markets, as credit spreads have tightened and more liquidity has turned to the market, i think investors are gaining comfort that, you know, a very negative mark kind of worst-case scenario doesn't necessarily reflect the reality of the markets. >> all right. i don't know, trish. those thasby nerds, bother me.
>> thank you very much. i guess i wouldn't want to work for thasby right now, being called a nerd and egg head, and i'm sure you have other names, as well. >> trish, you're above the nerd line. >> we try to keep the nerd factor low. . up next, details of the exxon conference call and how the markets are reacting. >> plus, what's all of the brouhaha about? we're talking about beer-gate with boston brewer john dock . >> we need a sober white house.
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we may have come in with a beat and a boost, but this week a controversy erupted between the company and the food and drug administration over allegations of quality control violations at a drug manufacturing plant. joining me live now from new york city and a cnbc exclusive to talk about the results and this investigation, is myla mylan ceo, mr. robert corey. thanks for being here, good morning, and are you ready to get going? >> yes, mike, good morning. >> good morning. tens of billions of dollars worth of brand-name drugs go generic over the next several years. so to what extent does that trend and the current health care reform debate, which no doubt, if it's passed, is going to cover a lot more people, and push them on to cheaper jenngen drugs, potentially going to help your sales and profits over time? >> i think all along we have been preparing for the increased generic utilization around the world. that is exactly what has prompted us to make the moves that we have made in the last
couple years, because, once again, we foresaw that the need in all health care systems around the world, the need for low-cost pharmaceuticals. so we actually have been loading up for this opportunity. >> now, the "pittsburgh post gazette" broke this story over the weekend about allegations at one of your plants in west virginia, where employees allegedly overrode quality control signals during the pill manufacturing process. short time later you came out with a strongly-worded statement, saying the fda determined these problems were minor, and i'm using your words, "baseless and unfounded. "however, the fda echl mailed us this statement. the investigation involves allegations that the fda takes very seriously. the investigation is ongoing. and the agency has formed no conclusions at this time. statements to the contrary are untrue. so it sounds to me, mr. corey, like you jumped the gun here and tried to put words into the fda's mouth. >> you know, mike, first of all,
i'm not going to, you know, talk for the fda. i have no intention of talking for the fda. we have never talked for the fda. we have a long-standing, very high-quality relationship with the fda. and the fda will continue its process to do whatever its process needs to get done. there are very technical terms. the fda has very formal processes, as i stated this morning. i stand by. i did not jump the gun. obviously, i would never do that. i've come across exactly what i thought i needed to do to communicate. we have, you know, millions -- hundreds of millions of patients on our product that needed to have some level of communication throughout this whole process. we are very close and on on going communications with the fda. you know, the only thing that i -- that really bothered me here is really the sensationalism. and the attempt to put words, you know, maybe in our mouth. i actually view this as a real
opportunity for our company, quite frankly. i believe, you know, there aren't too many companies, you know, given what was thrown at us, that i believe will be able to fare out, which i think is ultimately going to end up. >> mr. corey, in the meantime, as this investigation continues, could pharmacy benefit managers, drugstore chains, drug distributors, take a look at the product that they have in their inventories that came from this plant, and just as a precaution, send it back to you because they're concerned about safety issues? >> quite the contrary. when you have a 48-year exemplary track record, every one of our customers understand this business. as i stated, there are very technical terms. the fda was in on monday. they had a close-out interview on tuesday. they issued us no 483. they have completely, you know -- we are -- i think our customers and our patients know this. and that's why i want to thank the fda for moving so expeditiously not to have the
type of problems that i think you've just mentioned. >> finally and quickly, the other day the ceo of teva told us that watson and mylan would fit into his company's long-term strategy. isn't it just a matter of time before you get bought by teva or maybe a big phrma that wants a bigger footprint in generic drugs? >> i've got to give you a lot of credit, mike. each and every time you have me, you seem to put that little slipper in. mylan is a very strong, probably one of the best-positioned global companies in the world. i think we are set. i think the volumes that we do to become one of the world's global, most efficient low-cost generic pharmaceutical companies, we develop a scale in a commercial platform that is second to none in the industry. and i believe that all of our employees around the world are just absolutely committed for a stand-alone strategy. >> all right. but i'll add that many analysts think this is still a consolidating sector. thanks, robert corey, the ceo of
mylan, who, by the way, is ringing the closing bell at the nasdaq today. >> the dow is up 160 points or thereabouts. we've had a lot of good earnings reports and don't want to dwell on the exxon decline. stuff like kellogg's, coal gate, as extrazenca, and dow chemical, i don't think it beat but the stock is roaring. my point is, we've got earnings coming from all corners of the economy, melissa, and that is one of the great signs of strength that is driving this stock market higher. up next on "the call," home sales improving, prices stabilizing. so is it time to bail out on the obama relief plan? why is it not working, and what to do about it. >> plus, looking for the extra push to get you into the gym? would you and could you do it if your boss paid you? is it happens across corporate america. details coming up here on "the call."
the cable company announcing a 10% drop in earnings to 29 cents a share. revenues up, though, 10%. look at how the stock is trading. investors like that news, with revenues being up $1.57, a gain of better than 8% at 20 bucks and 50 cents a share right now. last trade. >> thanks so much, trish. the obama administration is pressing banks to pick up the pace of loan modifications for troubled homeowners. so far, only about 200,000 mortgages have been modified. the administration says that ultimately, it would like to see as many as 4 million loans modified. meanwhile, some say we have hit a bottom in the housing market anyway. so when our call of the wild, we asked, do we even need this program? >> let's bring in sherry oel i have son, author of closing nation, and senior economics reporter, and, of course, our very own, very knowledgeable diana olick. thanks to all of you for joining us. steve, let me let you take first crack at this. what do you think? do we need this program anymore?
>> well, i don't think we're out of the housing crisis at all. but i do think that this program has never really worked very well. not just because so few people have signed up for it, but if you look at the evidence of this kind of program in the past, what you tend to get is people have a loan modification, and then they pay their mortgage for six months or a year, and then they're just back into the same crisis they were before. and you don't see a long run reduction in the amount of foreclosures. >> diana, what is exactly the problem here? because i interviewed jamie dimon a short while ago, and he said they were going to do 600,000 modifications, and only 200,000 have been done so far anywhere. no one is close to the target. what's the problem? >> well, if you ask the banker, they'll say it took a while to ramp up the program, to get the information from the administration, and the administration is continuing to change some of the forms, but one of biggest problems the banks are having in modifying
these loans is 50% of borrowers facing foreclosures right now will not talk to their servicers. and that's after the servicers are sending them letters, calling them at all times of day, and even going to the property, trying to say, look, we can offer you a modification. the borrower doesn't want it, or the borrower doesn't talk to the servicer. so that's one of the reasons. another reason is that, look, this administration program was very careful in making sure that it didn't allow everyone to get a modification. as you remember, we were arguing months ago about who should and who shouldn't get one. not everybody qualifies. and then finally, job losses. if if you don't have a job, they cannot modify your loan. >> but sherry, wasn't this doomed from the start? all of the academic studies are showing that the redefaults on these so-called modifications are 50 do 70%. all of this tinkering was a lousy idea in the first place of mu much. >> yeah, historically, 60% of loan modifications don't work. but a couple of other things are in motion. a lot of things are playing into this, and part of those are still moving.
so the home prices until these case-shiller numbers which hopefully indicate we're seeing some bottom to that, are continuing to fall down. and the reasons driving the foreclosures were changing. originally, they started with the defaults due to the subprime teaser rates, and then we shifted into unemployment and bottoming home prices and people voluntarily walking away. now we're looking at allegedly 72% foreclosures being caused by unemployment. so when you have a difference in the problem, there has to be a difference in the solution and making homes affordable is really just being fine-tuned month by month. it was launched in february. to address those differences. >> and larry in the number you're saying, the 50 to 60% of loans are redefaulting, that estimate was based on old modification programs from the previous administration. we currently have no numbers yet from the making home affordable program, as to how many have redefaulted. barely three months old. >> why expect different results? >> because it's a different program. >> i want to say something to
applaud the obama administration on this. i think it's very financially conscientious for them to move slowly on this. look, we're talking about taxpayers taking a hit here. because when the government steps in and underwrites these loan modifications, somebody has to take the loss. and i've always complained that there's an element of unfairness of this program to the people who are paying their mortgage on time to have to pay more taxes for people who don't. >> that's right. that's right. >> and that's the catch-22, because this has largely been a voluntarily program, which if you want to call that part of the problem, that depends on your view of capitalism and free markets. but because it's been voluntary, that's been, quote, unquote, part of the problem, is lenders don't want to take the risks. >> my view of capitalism and free markets is a very positive view. the only thing i really like from washington, let them rent, steve moore. if you can make a deal for -- let them rent for a while. that might work. >> well, let them rent. and, you know, i still am a believer, larry, that you don't necessarily need to have the
government intervention. >> the crisis is over. come on. every -- >> lenders are not set up to be landlords. statistics show a bottoming. every statistic -- >> every statistic except the foreclosure number. >> wait a second, the distressed sales have been coming down markedly. when you look at the worst-hit states, california, arizona, nevada, florida. you're seeing prices down, sales up. and the quantitity of sales from foreclosures is getting smaller and smaller. this is a massive turn-around. >> but larry, there are other factors playing into that. some of those may be lagging indicators from foreclosure moratoriums, and some could be them holding before they put them on the market. really, we don't have enough extended statistical nal 'tis. >> my analysis is markets work. >> can i say one other thing about this? >> no, you can't -- >> we have to move toward the situation of recourse loans.
that will stop the foreclosures. >> that's true. that's a good point. now we're out of here. thank you for joining us, guys. >> wasn't that great a point. >> no, it is. >> all right, it was a great point. >> steve the hook, and larry that we're moving on here, because we want to talk about this whole president's beer thing coming up. the founder of boston beer company will be joining us live in a first on cnbc interview to discuss the white house beer summit. >> yes. what we need is at the white house. first up, details on a trend in corporate america that will get you to eat right and get paid for it at the same time. a novel way to cut corporate health care costs when "the call" returns in two minutes. please stay with us, right here, cnbc. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 i want everything right where i can find it. tdd#: 1-800-345-2550 anything that makes trading easier. tdd#: 1-800-345-2550 i want to be right in the middle of the action-- tdd#: 1-800-345-2550 you know-- i have to see what's going on. tdd#: 1-800-345-2550 and when i pull the trigger... tdd#: 1-800-345-2550 ...i've got to get the best price out there. tdd#: 1-800-345-2550 (announcer) try the new schwab.com
i'm mary thompson at the breaking news desk. the new york attorney general just released a 21-page report called no rhyme or reason, the heads eye win tail bank lose bonus culture. what this does is a report from the new york attorney general that looks at the bonuses paid out by the nine original t.a.r.p. recipients, and compares it to what they earned in 2008. just to give you a couple of headlines from this, a couple of banks that are highlighted here, of course, merrill lynch and citigroup. both of these companies losing about $27 billion in 2008. but merrill issuing $3.6 billion in bonuses, citi paying out $5.33 billion in bonus. and then you take a look at three other firms, goldman
sachs, morgan stanley and jpmorgan, combine the reports says they earned $9 billion last year while paying out $18 billion. a person close to the attorney general's office noting this report is not so much about wrongdoing, but suggesting there are systemic problems or inconsistencies and a lack of principle in the pay schemes that are used or pay scales used at wall street. and they're calling for the private sector to develop its own set of pay principles. one other thing we should note, this has been sent to the chairman of the oversight committee of the representatives, and it is expected he will be calling a hearing on these numbers. trish, back do you. >> mary, quick question for you. do they name these bonus recipients? >> no. no individual names used in this report. it's an aggregate number that they're using. >> thanks so much, mary thompson. the cdc reporting that medical costs for treating obesity doubled in a decade, hitting $147 billion in 2008. our next guest says obesity
prevention needs to start in the workplace, i don't know, i think it starts at home when you're a kid with diet. but if it starts in the workplace, would you lose weight if your boss paid you do. we want to bring in sean forbes, the provider of health and productivity programs that offers rewards to individuals for getting healthy. okay, sean, tell me how your program works. >> sure. we're a technology company that enables employers to execute on pay for prevention. we give them tools to inspect what they expect from their employees and reward them for doing the right thing. and we make the tools available to them on a cost-neutral basis. we think the innovation is pretty applicable to what we're trying to do overall in health care in the u.s. today. >> so how -- so in other words, if i lose ten pounds, my employer would give me some kind of bonus for that? i mean, how does that work? and are there parameters, like you need to be a certain amount overweight in order to get some kind of kick back from the employer? >> sure. good question. the cdc sets guidelines for what
amount of activity constitutes normal, and recommended. and what we do is, allow -- we provide a tool set that allows employers to put together a program where they can reward their employees for actually doing the things the cdc says they need to do to avoid preventible medical costs. that's the bulk of the costs that are driving up our overall health care system costs. >> i mean, sean, i can see that people who are in shape, and can lick obesitobesity, whatever ob is -- i don't know in i buy into this obesity stuff -- give them lower insurance rates. that's the incentive. but the rest of it is a matter of personal responsibility. what do your shareholders think about -- so i lose 12 pounds, are you going to give me a thousand bucks? i don't get that at all. >> well, what we'll do is, give you a tool so that you can make the right decisions day to day. you know, larry, you're an active tennis player, but across the last ten years, everybody, you know, has found that this
explosion in devices that can hold you still, like blackberries and say answer this one more e-mail, you know, they have distracted us from moving around as much as we have before. >> o, i don't know. but at the same time, i mean, back to -- and larry is shaking his head. it comes back to your individual sense of self, your self respect. your own desire to be healthy. i mean, why should that fall on the shoulders of your employer? >> thank you, trish. i mean, sean, with all due respect, you're a good man. but that is the worst line of reasoning i've ever heard. what, the invention of blackberries, the invention of telephones? the invention of the automobile? all of that means we -- it's okay to be fat? i mean, there should be some personal responsibility to your family. your kids. >> larry, you're exactly right. >> i'll give you the lower insurance rates. i think the whole insurance system should be built on the prevention issues. i think that's great. but bonuses? that's shareholder money. >> we completely agree, actually. what we do is provide a tracking system so that employees know
when they're taking the right amount of personal responsibility, do the right thing. you're exactly right. and in fact, one of the most popular ways that our program gets funded is by employers giving their employees discounts on their insurance, their personal contribution. >> i like that. >> based on them actually doing the right thing. and across the year, on a day-by-day basis, keeping track and changing their behaviors. >> all right. >> we've got to leave it there. sean, thanks so much. >> thank you. >> all right. we're going to be right back for a special last call on the presidential brouhaha. jim cook is the master brewer of sam adams and he is going to join us on a first on cnbc interview to talk about the white house beer summit. you know they are not drinking american beers at the white house? we're outraged. we'll be right back. >> boo, boo.
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i just want to say that. lots of brouhaha over the president's beverage of choice at today's beer summit with harvard professor henry louis gates and sergeant james crowley. joining us on a first on cnbc interview, the president of sam adams, jim cook, founder of the master brewer at jim adams. jim, what about this? they're having three nonamerican beers, right? on the front page of every paper today. >> yeah, i certainly wish that samuel adams could have made it to the white house. he was a founding father, and a patriot, and a revolutionary. but he never got to go to the white house. i think he would have been very happy coming as a beer and seeing what a great country we have. >> what do you think about this? i mean, did your pr people call them up and give them a terrible time? i mean, you guys, i know you guys got in contact with us, so obviously you have it on your mind. you must have bothered them, as well. >> well, we are happy that, you know, the president is sort of
focused on the serious issues. but to me, it's a great day for beer. and it brings beer back to its original, you know, purpose, as something that was there when the declaration of independence was written, when the revolution was started. >> what about the issue -- i'm all for sam adams and the declaration of independence. but what's this -- i don't understand. what melissa is trying to say is there is no american domestic beers on the table. that ain't good. >> no. >> why are we touting foreign beers when we want to buy america when we can? i'm a free trade e don't get me wrong. but because of our great tradition in beer-making, you should complain. you should dial them up and say where are the american beers? >> yeah, i think it really underscores the difficulty that, you know, very small brewers like sam adams -- we're less than 1%, so not even small, we're tiny. it shows you how hard it is in the beer business to, you know, get your beer on to the shelves, and into the consumers' hands, no matter how good it is.